The Body Shop, a well-known skincare chain that has been around for half a century and also has a store in Hong Kong, recently announced bankruptcy proceedings in the UK, putting more than 2,500 employees at risk of losing their jobs, while its global franchise stores will not be affected. Since the establishment of the first store in the UK in 1976, the founder has maintained its ethical stance and has become a household name in the local area.
However, in recent years, the brand has shown fatigue and lost innovation, and under the long-term financial difficulties, three different groups have taken over the acquisition, but they have not been able to recover the decline and finally embark on the road of decline.
Founded in 1976 by the late environmental and human rights activist Anita Roddick, The Body Shop sells vegan soaps, skincare and cosmetics with an emphasis on fair** practices, and is known for promoting natural, ethical products and against animal testing, helping to push for a UK** ban on animal testing of cosmetic ingredients in 1998.
In 1988, Anita Roddick was made an OBE and later knighted by the Queen. At the time of her death in 2007, The Body Shop remained committed to its ethical stance, including refusing animal testing and sourcing fair** materials.
Once popular with consumers of all ages, The Body Shop became even more well-known with its listing on the London** Stock Exchange in the 80s, with branches in several countries around the world, many of which were franchised, allowing the brand to seize the market very quickly. At its peak, The Body Shop had stores in more than 70 countries and regions.
In the 1980s and 90s, The Body Shop was one of the UK's most popular retailers, and the brand was family-owned for the first three decades until 2006The £5.2 billion (about HK$6.3 billion) was sold by the French cosmetics giant L'Oréal (L'Oréal'oréal) began to change hands repeatedly.
In fact, in recent years, skincare brands with environmental protection and animal rights have emerged, and fierce competition in the market has directly led to the continued sluggish performance of The Body Shop. According to L'Oréal's financial results for the first nine months of fiscal 2016, The Body Shop's performance in Hong Kong and Saudi Arabia was sluggish, with sales falling 4% to 5% year-on-year99.5 billion euros.
Jean-Paul Agon, Chairman and CEO of L'Oréal, has admitted that there has been no successful integration between the brand and the group. Eventually, L'Oréal decided to abandon the loss-making business and sold The Body Shop to Natura in Brazil.
After Natura acquired home cosmetics group Avon (**on) in 2019, the coronavirus pandemic and rising global interest rates saddled the company with huge debts. In order to focus on saving its core Latin American market, Natura launched a 2£0.7 billion** to German private equity firm Aurelius.
At the time, Aurelius expressed optimism that the group could breathe life into the iconic British brand despite the challenging retail market. However, the company soon found out that The Body Shop's business was dismal during the Christmas and New Year season, and it was determined that it could not revive the business in less than three months, so it appointed FRP Consulting as the manager to handle The Body Shop's insolvency proceedings in the UK. The management is still keeping the store running for now and will consider all options to find a way out for the brand.
FRP said the brand has faced long-term financial challenges in the past under the leadership of different operators; At the same time, the environment for the entire retail industry is quite difficult. However, if the bankruptcy is not escaped, the more than 2,200 employees of the local chain store will be at risk of losing their jobs. The British "Guardian" quoted experts as saying that The Body Shop is not a brand that can be listed by any retailer, and it needs to communicate and ensure its fair sourcing details through its own chain stores, otherwise it will lose its magic.
At present, The Body Shop has about 200 stores in the UK, more than 2,500 employees, and 3,000 stores in 70 countries and regions around the world, and 20 stores in Hong Kong, Kowloon and New Territories.
According to the information, The Body Shop leased shops C and D on the ground floor of Youcheng Commercial Centre with an area of about 1,690 square feet, and the brand entered the market as early as the early 90s, with a monthly rent of about $330,000 at the beginning. By the time of the peak retail season in 2013, the monthly rent of shops had reached $1.6 million, and the rent per square foot was about $946, and the rent of shops had soared by 38 times. The brand renewed its lease in August 2019, but at that time, just after the outbreak of social movements, the monthly rent of the shop dropped to $900,000, and the rent per square foot was about $532, which was still about 17x growth.
In 2022, the body shop moved out of the commercial center in 2022, and returned to the unilateral shop after more than a year, but the area was reduced to about 876 square feet, and the monthly rent was about 400,000 yuan, that is, about 457 yuan per square foot, and it continued to become a hot spot for Hong Kong people.